URGENT PRACTICE ADVISORY FROM

ACEC-CANADA

 

 

RE: REQUEST FOR STANDING OFFER FOR CONSULTING SERVICES


Reference No. 108753

 

Issued by Brookfield Global Integrated Solutions (BGIS)
on behalf of Public Services and Procurement Canada

 


 

Recommendation:
The Association of Consulting Engineering Companies-Canada (ACEC) recommends that firms consult with their insurers and seek legal advice before deciding whether to respond to this RFSO.
 
The RFSO can be viewed by clicking here.

 
Issue:
The Supplementary General Conditions (SGCs) applied to the standard agreement are onerous with, among other concerns, an effective limit of liability of $20,000,000. The value of the assignments issued under this Standing Offer are expected to average $60,000-$80,000 in fees. Further, there is no indemnification for reuse of intellectual property by third parties. Other provisions of the SGCs also transfer significant risk onto the consultant and may be uninsurable. Firms should confirm with their insurers whether their policies will cover these provisions.
 
Background:
BGIS has consulted with ACEC, the Royal Architectural Institute of Canada (RAIC) and Interior Designers of Canada (IDC) on the entire RFSO documentation and BGIS has addressed some concerns.
 
However, even though BGIS has adopted ACEC Document 31 as the standard form of agreement for this Standing Offer, some SGCs have nullified many of the clauses intended to fairly balance risk and reward between client and consultant and have in fact transferred significant additional risk to the consultant.
 
Despite frequent discussions, BGIS has made it clear that it intends to maintain a number of onerous SGCs, including the current limits of liability, and that it intends to “test the market.”
 
Disclaimer:
This advisory is provided for information only. As always, it is up to each firm to independently make its own decision whether to respond to any commercial opportunity.